Euro slumps as Greece nears default

The euro slumped against the dollar Tuesday as Greece lurched to the brink of default on an IMF loan payment and failed to get an extension on its European bailout.

The 19-nation shared currency was under pressure in a fast-moving day of developments.

Greece asked for a fresh two-year bailout program from the European Union, with the current program expiring Tuesday.

Chancellor Angela Merkel of Germany said she would not discuss any new request until after Sunday's Greek referendum on the proposals from creditors.

Then Athens said it had asked the International Monetary Fund to extend the Tuesday  deadline for its payment of about 1.5 billion euros ($1.7 billion), a move that wold give the government financial room to continue negotiations with official creditors.

"The volatility in the euro is indicative of the ongoing concern and the volatility of the Greek debt talks," said Kathy Lien of BK Asset Management.

"The market is still waiting with bated breath what happens. At this point the main focus is going to be the July 5 referendum," she said.

Whether Greek voters support the proposals in the referendum or oppose them, as the Greek government wants, their decision will create uncertainties because a 'yes' vote would mean the ouster of the government and a 'no' vote would indicate Greece was headed for an exit of the eurozone, she said.

2100 GMT   Tuesday   Monday

EUR/USD     1.1139    1.1247

EUR/JPY     136.38    137.83

EUR/CHF     1.0414    1.0404

EUR/GBP     0.7089    0.7148

USD/JPY     122.44    122.55

USD/CHF     0.9349    0.9249